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Two sober home owners got kickbacks from treatment program, state says

Two Palm Beach County men have been arrested for allegedly receiving kickbacks for brokering patients from sober homes they owned to a substance-abuse treatment program, the Palm Beach County State Attorney’s Office said Thursday.

WEST PALM BEACH

Two Palm Beach County men were arrested Thursday for allegedly receiving kickbacks for brokering sober-home patients to a substance-abuse treatment program — the latest round in an effort by authorities to target corruption in the county’s $1 billion addiction-treatment industry.

Bryan Norquist and John Dudek are facing multiple counts of directing patients to Whole Life Recovery of Boynton Beach in exchange for money — in Dudek’s case, $450 per patient, the Palm Beach County State Attorney’s Office said.

Each count — Norquist, 26, of Boynton Beach faces 16 and Dudek, 55, of Delray Beach six — is punishable by up to five years in prison if the men are convicted. Norquist is the co-owner of The Halfway House and Dudek is the owner of Southern Palm Oasis, both sober homes in Delray Beach, according to Delray Beach police. Both men bonded out of the Palm Beach County Jail early Friday.

Their arrests came as part of a continuing investigation by the county Sober Homes Task Force, which formed in July and is comprised of local law-enforcement agencies. In October, authorities raided Whole Life Recovery, a Boynton Beach treatment center, and arrested the facility’s owner and manager.

Whole Life Chief Executive James Kigar, a Boca Raton resident and operations consultant Christopher Hutson of West Palm Beach were arrested on multiple counts of patient brokering. At the time, Palm Beach County State Attorney Dave Aronberg called it a “major first step” in stopping bad sober-home operators.

Delray Beach Police Chief Jeff Goldman told The Post that Thursday’s arrests were another important step in that effort. Goldman — whose city has long had a large number of sober homes and already has seen about 400 drug overdoses this year — emphasized that local police will not tolerate patient brokers exploiting a vulnerable population.

“They’re not doing these kids any justice,” Goldman said. “These kids are addicted, which is a disease. They’re being abused and are in a very vulnerable state. These bad operators are taking advantage of them.”

Patient brokering delivers recovering addicts who have health-insurance policies to treatment centers that can then collect thousands of dollars in payouts from the insurance companies.

Some treatment centers have made large profits charging insurers for numerous and often unnecessary drug-screening tests, quickly running up bills in the thousands of dollars, The Palm Beach Post reported in a series of stories dating to August 2015.

The Post has reported that one addict’s insurance company paid $5,600 for every drug test and $1,075 for every session of intensive outpatient treatment, both of which occurred three times a week. One addict with similar insurance could bring a treatment center nearly $120,000 in three months, The Post found.

A referral to a sober home can nab patient brokers up to $500 — even though state law makes it illegal for a person to offer to pay either a commission or bonus to induce the referral of patients either to or from a health-care provider.

“It’s making substance-abuse treatment not about treatment. It’s turning into a money-making operation,” said Delray Beach Detective Nicole Lucas, who led the investigation into Norquist and Dudek’s actions.

“We’re getting away from caring about people and trying to help them recover from substance abuse.”

Police say Norquist and Dudek tried to cover up their crimes by entering into case-management agreements with Whole Life Recovery. These agreements are reported to be commonly used by treatment facilities to circumvent state law.

Police say Dudek was responsible for providing case management for the patients he referred. He completed weekly reports of services he was supposedly providing, according to an arrest report made public Thursday. Records show that in August, Dudek received weekly checks ranging from $500 to more than $1,000 for the referral of patients, according to the report.

Police say that Norquist and his brother, Patrick, signed a patient referral contract with Whole Life Recovery in April. Starting that month, The Halfway House received payments for much as $4,000, police said.

A former employee at Whole Life told Delray Beach police investigators she provided many of the case-management services that the sober home owners claimed to be providing. Among those services were obtaining bus passes and food stamps and finding doctors to handle matters other than substance abuse, police reports said.